Wednesday, January 27, 2010

Ways in Which a Consultant Finds Work

My first job as a consulting geologist came to me in the spring of 2004. Prior to that year I had not worked as a consultant, but only as an employee of medium to large companies. When starting consulting in 2004—after an aborted attempt at finding consulting jobs during the gold crash of 1997–1998, which immediately followed the Bre-X scandal—I was returning to the business after a hiatus of more than 10 years.

— NOTE: The Bre-X scandal/scam did not cause the gold crash, although I've read opinions stating that it did. The scandal certainly made the entire process of getting funding more difficult, and in the short term, getting funding became impossible or nearly impossible for many companies, especially the Canadian juniors. The scandal did contribute to the depths that the price of gold reached and the length of time it stayed in those depths.

It was early in the year, and I had been in negotiation for a job with a certain promotional company. They had a property they wanted to drill, and they wanted me to manage the rig(s) and log whatever was going to come out of the hole. The drill rig was expected to arrive at any moment, but that expectation had been in operation for at least two months.

The mining industry was just getting back on its feet that year, and it was difficult finding drilling companies, drillers, and drill helpers. After the gold crash of 1997-1998, drillers, especially all the good ones, had fled their industry for parts known and unknown: water well drilling in California and early retirement were the two options I had heard. Good drillers can sometimes retire early, say by age 45, if they save their $$ and don't spend it all in bars while on the road.

So the start date of the drilling project kept getting postponed, and although there was certainly a lack of drillers on which to blame that postponement, I'm pretty sure that funding also had something to do with the delay. So I kept calling, and I kept hearing "two weeks from now" and "end of the month"—the latter phrase usually indicating a time three to four weeks in the future depending on when I called. I didn't have any other leads, so I kept calling.

I also understood that some boss down the hall didn't want to pay me a daily rate that added up to more than his salary—never mind that he had company benefits, including that nice company truck in which he'd just returned from some mid-afternoon trip to Home Depot. And he had an office, and a secretary, and paid-for phones, and computers, and a draftsman or CAD person, and... yada, yada. The going rate for average consulting jobs in the mid to late 1980's had been $300/day—we paid a specialist $450 in 1989 or 1990. This down-the-hall guy wanted to pay me less than $300. Needless to say, I wasn't too fond of this barely-met scrooge.

And then it was April. All this project talk had started in January or February. Out of the blue, a former colleague and friend of mine called and said he had a drilling project that was expected to run through October, maybe into November or December. He called because friends of mine—all former colleagues—had been telling everyone that I was back and needed a job.

I explained my situation to him: that I'd told another outfit that I was available for their project, but that it hadn't started yet, and that I'd been waiting on it for several weeks. And when did my friend want me to show up? Well, he said, yesterday would be really good, but the following Monday would work—and that would give me a five-day introduction to the property and project before I'd come into my part of the schedule on the Tuesday following that first Monday. In other words, I'd work five days, take three days off, and then come back and start regular 10 and 4's.

So I called the other guy to see what he knew about his drilling schedule, when would the drill rig be there and when could I start. Once again, it was looking like "end of the month" or early the following month—and, no, he couldn't promise a start date. I told him I had another offer starting yesterday, and I didn't see how I could turn it down. I felt a little uncomfortable and awkward telling him that, but he hadn't offered any kind of retainer (not usually done), nor had he found any non-drilling work to keep me at least partially employed while waiting for the rig (or the funding, or whatever). I thought maybe he was annoyed with me for at least a couple years after that, when I'd see him at meetings, but as time has gone one, I've decided it was all in my head, all my own worry.

It turns out that I took a daily rate less than the $300 I wanted, but besides being paid an average mileage rate to and from the job site for every ten-day trip, I drove a company truck on site, and received a nice per diem for food and lodging. I stayed at a place with a very low monthly rate and made most of my meals in the room. So the daily rate was close to $300 when how much I didn't spend on food and lodging was considered.

And that's how my first consulting job came to me in the spring of 2004. I didn't send a resume, and I didn't really have an interview.

Some References:
Alden, Andrew, The Bre-X Gold Scandal: First there is a gold mountain then there is no mountain: Geology.

Anklin, R. E., and Varandan, Sheila, 1999, Bre-X in Hindsight: What We Know about the Busang Gold Fraud: 1999 Southwest Review International Business Research March 10-13.

Behar, Richard, 1997, Jungle Fever: The Bre-X saga is the greatest gold scam ever. But to understand the enormity of the fraud, you had to be there. Our man in Borneo tells his story: Fortune Magazine, June 9, 1997.

Branan, Nicole, 2007, Bre-X scandal ends with acquittal: Geotimes, October, 2007.

CBC News, Bre-X timeline: From boom to bust, Last Updated July 31, 2007.

Danielson, Vivian, and Whyte, James, 1997, Bre-X: Gold Today, Gone Tomorrow: Toronto, The Northern Miner, 304 p.

Danielson, Vivian, and Whyte, James, 1997, A few desperate men and a salt shaker -- An excerpt from The Northern Miner's Bre-X: Gold Today, Gone Tomorrow (paywalled): The Northern Miner, v. 83, no. 37.

Updated References 14Jun2012

No comments: